Once an online bookseller, Amazon now offers original movies and TV shows, grocery delivery, two-day shipping – and stop-loss insurance? It’s a possibility, now that the company is turning its attention to healthcare and health insurance technology. Amazon has recently made several interesting investments in the healthcare space. From its humble beginnings in Jeff Bezos’s garage to its current position as the most valuable company in the world, Amazon has proven time and again that it’s comfortable with reinvention.
The First Steps: A New Partnership for Employee Healthcare
Amazon’s new healthcare chapter began in January 2018, when Amazon, Berkshire Hathaway and JPMorgan Chase & Co. announced they were partnering to improve healthcare for their U.S. employees. The group said that its primary aims were to improve employee satisfaction and reduce costs for its combined U.S. employee base of about 1.2 million people.
No specifics have been unveiled yet, and few announcements have been made in the last year about progress on the initiative. We don’t know much, other than that the independent company formed by the initiative will be based in Boston and will be led by Dr. Atul Gawande, a Harvard surgeon.
What we do know is that technology will play a major role in the company’s work. Some analysts speculate that Amazon may use the employee group as a testing ground for new healthcare products and services.
Another Venture: Medical Records Technology
Amazon doesn’t really do small, so the joint venture with Berkshire Hathaway and Chase was just one of its new healthcare pursuits in 2018. In November, it was announced that the company’s engineers were working on software that would read and digitize medical records and clinicians’ notes.
One of the exciting possibilities about the software is that it would be able to read handwritten notes. The latter is a difficult task, especially considering that doctors are notorious for having illegible handwriting and that handwritten notes are filled with misspellings and abbreviations. Having the ability to decipher and quickly digitize those records makes them easy to catalogue and search.
It’s also worth noting that in mid-2018 Amazon bought PillPack, which sorts and ships medications directly to customers’ homes. That move could signal that the company is planning to move into the pharmacy space.
What Amazon’s Moves Mean for Insurance
We know that, in one year alone, Amazon made several interesting moves into the healthcare industry. It bought a pharmacy company, started developing its own medical records software and announced a new project related to employee health, with an emphasis on pioneering new technology. Some industry experts predict that those moves could be pointing toward Amazon’s plans for another new venture: insurance.
Stephen Buck, co-founder of Courage Health, told CNBC that he thinks Amazon could be working toward a future as an insurer, pharmacy benefits manager or both. CB Insights, which predicts technology trends, suggests that Amazon could be building health insurance technology as a stepping stone on its way to offering stop-loss insurance to self-funded employers. The company’s new partnership with Berkshire Hathaway, which recently entered the stop-loss market itself, could prove to be useful if Amazon does go that way.
Bezos is famously tight-lipped about future plans for Amazon, so all industry experts can do at this point is speculate about the exact nature of the retail giant’s future in healthcare. Although the company is known for its fast, two-day shipping, any progress Amazon makes on this front will surely happen slowly.
Stop Loss Insurance Brokers, Inc. is committed to tracking all news related to health insurance technology, so we’ll be closely watching what unfolds at Amazon in the coming years. In the meantime, our experts are always here to help your business make the best insurance choices. Contact us with any questions.